Synopsis
A recent report indicates that Indian equity markets have transitioned into the 'attractive zone' from previous categories. This shift presents promising opportunities for long-term investors despite global uncertainties. Union Mutual Fund reports strong fundamentals and favorable tax changes expected to boost SIP inflows significantly in the coming years.Key Takeaways
- Indian equity markets are now in the 'attractive zone'.
- Long-term outlook remains positive despite global tensions.
- Strong macroeconomic fundamentals support market optimism.
- New tax regime expected to boost investments.
- SIP inflows could reach Rs 40,000 crore in 18-24 months.
New Delhi, April 8 (NationPress) Indian equity markets have transitioned into the 'attractive zone' from the 'fair' and 'moderately expensive' categories where they remained for the majority of 2024, according to a recent report released on Tuesday.
This transition signifies a significant improvement, presenting a favorable opportunity for long-term investors, as highlighted in the Union Mutual Fund report.
In spite of ongoing global geopolitical tensions and trade uncertainties, India’s long-term outlook appears to be bright.
Harshad Patwardhan, Chief Investment Officer at Union AMC, noted that robust macroeconomic fundamentals, strong corporate and banking balance sheets, anticipated demand resurgence due to tax incentives and welfare programs, along with indications of a new private investment cycle are all positive indicators.
“The resilience of corporate and banking sector balance sheets, the potential for demand revival spurred by tax relief and enhanced welfare schemes, and the possibility of a new private capital expenditure cycle are crucial positives bolstering our outlook,” stated Patwardhan.
Madhu Nair, CEO of Union AMC, emphasized that long-term investing is fundamental to wealth accumulation. “It’s human nature to overestimate short-term effects and underestimate long-term potential. We believe the next decade to 15 years will be highly promising for the Indian economy and markets,” he asserted.
He encouraged investors to concentrate on their financial objectives and to continue investing through Systematic Investment Plans (SIPs).
Union Mutual Fund is also hopeful for a surge in investments under the newly implemented tax regime, effective from April 1.
According to the Union Budget 2025, individuals with annual earnings up to Rs 12 lakh will be exempt from income tax. “This will enhance disposable income, allowing households the opportunity to invest more in long-term instruments such as SIPs,” the report indicated.
With this optimistic market outlook and favorable tax modifications, the report anticipates that monthly SIP inflows into the mutual fund sector could rise to Rs 40,000 crore within the next 18 to 24 months, bolstered by increasing income levels and growing awareness regarding financial planning.
